Medical Facilities Corp T.DR

Other Considerations of Fair Value

[nozzpack]

The Ebitda multiple is another way to value DR.

I provide data for the last 3 years along with net debt ( cash less LT debt )

Year                  Ebitda          EV              EV/Ebitda           net debt 

2017                  $94.6 m     $551 m         5.8                      $9 m
2018                  $99.0 m     $518 m         5.2                      $25 m
2019                  $96.2 m     $419 m         4.4                      $35 m
2020( H1 x 2 )   $86.2m      $125 m         1.5                      $-11 m

DR has the best balance sheet in its recent history and with the sale of low margin assets, has very robust operating margins.

The average EV to Ebitda for recent years is 4.8.

DR is currently trading at just 1.5 times, which suggests a 3 fold increase from current levels by exit 2020................ approx $13 per share

[nozzpack]

The average EV to Ebitda multiple for the US Hospital Healthcare sector is 9.37 https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/vebitda.html

[nozzpack]

Using peer EV to Ebitda multiple for the US ( 9.37 ), DR would be valued above $20 per share. It is in fact not unreasonable, as DR now have no net debt and pays a very nice dividend..